A limited constitutional government calls for a rules-based, freemarket monetary system, not the topsy-turvy fiat dollar that now exists under central banking. This issue of the Cato Journal examines the case for alternatives to central banking and the reforms needed to move toward free-market money.

The more widespread use of body cameras will make it easier for the American public to better understand how police officers do their jobs and under what circumstances they feel that it is necessary to resort to deadly force.

Americans are finally enjoying an improving economy after years of recession and slow growth. The unemployment rate is dropping, the economy is expanding, and public confidence is rising. Surely our economic crisis is behind us. Or is it? In Going for Broke: Deficits, Debt, and the Entitlement Crisis, Cato scholar Michael D. Tanner examines the growing national debt and its dire implications for our future and explains why a looming financial meltdown may be far worse than anyone expects.

The Cato Institute has released its 2014 Annual Report, which documents a dynamic year of growth and productivity. “Libertarianism is not just a framework for utopia,” Cato’s David Boaz writes in his book, The Libertarian Mind. “It is the indispensable framework for the future.” And as the new report demonstrates, the Cato Institute, thanks largely to the generosity of our Sponsors, is leading the charge to apply this framework across the policy spectrum.

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Tag: capitol hill

Today the Cato Institute placed an ad in major newspapers highlighting specific spending cuts that policymakers should make to restore our country’s fiscal sanity and economic stability. Our public call for policymakers to demonstrate leadership on spending cuts comes in the midst of the on-going battle on Capitol Hill over funding the government for the remainder of fiscal 2011.

A graphic at the top of the ad measures the $61 billion in cuts that Republicans have proposed against fiscal 2011 estimates for total spending, the deficit, and interest on the debt. As the graphic shows and the ad notes, it is clear that “leaders and members of both parties are in deep denial about the fiscal emergency we face.”

There are news reports that Republican and Democrat negotiators are heading toward a compromise figure of $33 billion in spending cuts. Let’s put that figure in perspective alongside the GOP’s original proposal to cut a whopping $61 billion:

Is the Obama budget a serious stab at deficit reduction? And do congressional Republicans have any credibility in knocking the budget plan since, other than Sen. Rand Paul (Ky.), they have not detailed many cuts that would seriously slice the deficit?

My response:

It’s Valentine’s Day and love is in the air, especially on Capitol Hill where Congress anxiously awaits the 10:00 a.m. arrival of the president’s FY 2012 budget. It should be well shredded by noon.

And as it is, across the land we’ll be hearing the cries of “Not me, please, not my sinecure” – no more plaintively than from the minions of the Corporation for Public Broadcasting. How will the average Chicago Bears fan endure without the latest BBC soap – excuse me, Masterpiece Theatre production?

But if that should come to pass, woe be unto those CPB congressional supporters who survived the November shellacking, the very ones who brought us to this sorry state by failing, for the first time in our history, to pass a single spending bill. Hell hath no fury like that of an NPR patron scorned.

The Washington Times says that the upcoming farm bill re-write could “sow division in the GOP.” While House Republican leaders John Boehner, Eric Cantor, and Kevin McCarthy voted against the 2008 farm bill, the new chairman of the House Agriculture Committee, Frank Lucas (R-Okla.), is a dedicated supporter of farm subsidies.

The Times recalls Boehner’s comments on the 2008 farm bill:

“The farm bill has often been abused by politicians as a slush fund for bizarre earmarks and wasteful spending projects, and the latest version … is no different,” Mr. Boehner, then the GOP minority leader, said at the time.

It’s too bad then that the Boehner-friendly Republican Steering Committee, which decided the committee chairs, didn’t appear to blink at handing the agriculture committee gavel to a key supporter of the “slush fund.” And it’s not as if Lucas has been circumspect in his intentions. Lucas’s agriculture issues section on his website, which hasn’t been updated since the Republicans took back the House, makes that perfectly clear:

As Ranking Member of the Agriculture Committee, I have long been a champion of voluntary agriculture conservation programs. During the drafting of the 2002 Farm Bill, I worked to secure the largest ever increase in programs such as Environmental Quality Incentives Program, the Conservation Reserve Program, and many others. In the 2008 Farm Bill, I advocated for renewable energy provisions to be included in the farm bill which would allow rural areas to play a larger role in making the U.S. less dependent on foreign sources of energy. I am proud that the 2008 Farm Bill devotes a funding stream to renewable energy research, development, and production….

[I] will work closely with Chairman Peterson and other members of the committee to ensure that cuts are not made to agriculture producers – farmers and ranchers.

Lucas isn’t shy about touting his support from the myriad farm lobby groups either:

I have been proud to receive recognition from various agriculture groups for my work in support of their concerns. The American Farm Bureau Federation has presented me with its “Friend of Farm Bureau” award for supporting Farm Bureau issues in Congress in 1996, 1998, 2000, 2002, 2004, 2006. In both 2002 and 2003, the National Farmers Union recognized me with the “Presidential Award for Leadership” for issues important to rural America. NFU also recognized me with the “Golden Triangle Award”, which is given to those who have demonstrated outstanding leadership on issues affecting family farmers, ranchers, and rural communities. In 2002 the Oklahoma Wheat Commission presented me with their “Staff of Life” award for voting in favor of wheat growers and farmers 100 percent of the time. And for two years running, the National Association of Wheat Growers named me one of only 11 “Wheat Champion” Members of Congress for superior action in Congress in support of the wheat industry.

Last year, Lucas criticized the Obama administration for proposing some minor agriculture program cuts, including a proposal to limit direct subsidy payments to farmers with more than $500,000 in annual sales.

Frank Lucas criticized the Obama administration for merely wanting to deny farmers with a half million dollars in sales from grabbing taxpayer money, but take a look what he has to say in a section on his website on “lower taxes and government spending:”

Spending in Congress has reached historic levels during the 111th Congress. The fiscally irresponsible behavior of former Speaker Pelosi and President Obama has driven our national debt level to the point that it is almost equal to the size of our entire economy. This is unacceptable and it must stop.

I have opposed – and will continue to oppose – spending initiatives that dramatically increase the size and scope of the federal government while adding to our already massive national debt. I have long been a supporter of tax reform and will continue to fight against increases in taxes and wasteful federal spending. Congress must get back to the business of fiscal responsibility and strive for a balanced budget without raising the taxes of hard-working Americans.

Lucas must know that “taxes of hard-working Americans” are pouring into the pockets of generally high-income farm businesses at the rate of $15 billion to $35 billion annually. While Lucas may be a “Wheat Champion” he sure isn’t a Taxpayer Champion, at least not on agricultural issues.

[L]obbyists connected to US Senators suffer an average 24% drop in generated revenue when their previous employer leaves the Senate. The decrease in revenue is out of line with pre-existing trends, it is discontinuous around the period in which the connected Senator exits Congress and it persists in the long-term. … Measured in terms of median revenues per ex-staffer turned lobbyist, this estimate indicates that the exit of a Senator leads to approximately a $177,000 per year fall in revenues for each affiliated lobbyist.

The fall is steeper, the researchers find, when the departing member of Congress sat on a powerful committee such as Appropriations, Senate Finance, or (on the House side) Ways and Means. Lobbyists who are ex-staffers are also more likely to quit the lobbying business once “their” member departs office. Incidentally, actual per-lobbyist revenue is lower than you might assume from the above figures, because many lobbying contracts are shared out among several participants with each individual getting only a portion of the proceeds. (Jordi Blanes i Vidal, Mirko Draca, and Christian Fons-Rosen, “Revolving Door Lobbyists,” via Alex Tabarrok).

If you needed another reason to vote against that unsatisfactory incumbent this fall, reflect that by doing so you’ll also be dimming the stars of his or her unsatisfactory ex-staffers.

The Obama team regularly dismisses opponents as industry lackeys. The Democratic National Committee blasted out e-mails this week warning that “for every member of Congress, there are eight anti-reform lobbyists swarming Capitol Hill” and “Congress is under attack from insurance lobbyists.”

But drug industry lobbyists, according to Politico, spent the weekend “huddled with Democratic staffers” who needed the drug lobby to “sign off” on proposals before moving ahead. Meanwhile, we learn that the drug lobby is buying millions of dollars of ads in 43 districts where a Democratic candidate stands to suffer for supporting the bill. The doctors’ lobby and the hospitals’ lobby are also on board with the Senate bill.

So the battle at this point is not reformers versus industry, as Obama would have you believe. Rather, it is a battle between most of the health care industry and the insurance companies.

(And the insurers are not opposed to the whole package. On the bill’s central planks — limits on price discrimination, outlawing exclusions for pre-existing conditions, a mandate that employers insure their workers and a mandate that everyone hold insurance — insurers are on board. They object mostly that the penalty is too small for violating the individual mandate.)

Here is the message members of Congress should send to Ben Bernanke during the Fed chief’s annual Capitol Hill testimony this week: He is fighting for his job. With his term up in January of next year, Bernanke needs to be called to account for the Fed’s many questionable actions during the financial turmoil of the past year.

Even while correctly identifying the “global savings glut,” Bernanke sat by and did nothing about the unsustainable build-up of leverage in the housing market—the “bubble” which famously burst in late 2008. Bernanke also used Fed financing to bail out Bear Stearns and AIG—hotly political moves which should rightfully have been left to Congress—and oversaw the massive expansion of the Fed’s balance sheet from about $900 billion to over $2 trillion. Under Bernanke, the Fed has transcended monetary policy and bank supervision into the world of fiscal policy.

While thus politicizing the Fed on one hand, Bernanke has sought to insulate the bank from congressional pressures by appeasing majority Democrats with various new credit regulations. Both the recently proposed credit card and mortgage rules unnecessarily restrict credit and increase the litigation risk facing banks, while doing nothing to roll back some of the irresponsible lending policies that exacerbated the housing bubble.

Bernanke’s pandering to the Left on misguided “consumer protections,” and the absence of any debate over the Fed’s role in the housing bubble, raise serious questions as to whether Bernanke understands the causes of the current financial crisis. We cannot hope to avoid the next financial crisis without a Fed chairman who understands the current one.